Branstad signs pro-Israel legislation

DES MOINES - Gov. Terry Branstad signed legislation Tuesday that would prohibit state funds from being invested in or contracted with companies that are openly engaged in a boycott of Israel.

Backers say House File 2331 - which is similar to previous restrictions placed on the investment of public funds in Iran and Sudan - is intended to counter the Boycott, Divestment and Sanctions (BDS) Movement that is trying to encourage countries, governments and companies to boycott Israel and Israeli companies.

'We think this boycott of Israel is totally wrong and this is a way that we can make a strong statement about our support for Israel and our opposition to those that would boycott Israel,” Branstad told reporters at a signing ceremony attended by a couple dozen advocates and legislators.

'I just think it's the right thing to do,” added the Republican governor. 'I think it sends an important and a very clear signal that we're not going to do business with people that boycott Israel. We think that is wrong and we think that is a prejudicial position that some countries and some companies have taken. We want to stand on the side of what is right and good.”

Branstad drew parallels to when Iowa joined other U.S. states in demanding the 'divestment” of public funds in companies engaged in business activities in South Africa as a way to successfully force an end to that country's policy of racial segregation. 'We dealt with this before with apartheid in South Africa, so I think we need to stand up to evil,” the governor said.

'You have countries like Iran that want to wipe Israel off the face of the earth and it's a stand against that kind of bigotry and hatred,” Branstad told reporters. 'We saw this with the Nazis in World War II.”

The Rev. Gary Nims on behalf of the United Methodist Church advocacy team had written Branstad requesting that he veto the bill in deference to Palestinian Christians seeking to promote investments in companies that do no harm to efforts to attain a peaceful coexistence between Israelis and Palestinians.

'We feel boycotts for social, political and economic change are political speech protected by the First Amendment,” Nims wrote in his letter. 'The United Methodist Church supports this peaceful action in the name of justice.”

House File 2331, he added, gets Iowa involved in U.S. foreign policy which is the sole right of the federal government. He said his church does not support a boycott of products made in Israel, but opposes products made by Israeli companies operating in occupied Palestinian territories.

In becoming the ninth U.S. state to enact such legislation, Branstad said Iowa was reinforcing ties with an important trade partner, noting that since 1996 Israel has imported $482.6 million worth of Iowa goods, making it the state's 34th largest trading partner. He said Iowans also share the same values of freedom and democracy with Israel along with a strong economic bond.

Legislative critics had expressed concern H.F. 2331 would create bureaucratic headaches for retirement funds via the Board of Regents, IPERS and others that would have to research thousands to companies connected with mutual funds to comply with the bill.

According to the Legislative Services Agency, the bill will not impact the state general fund and the impact on the retirement funds cannot be determined.

Nims said being fiscally responsible includes understanding the fiscal impact before a law is passed. 'Passing legislation that mandates boycotts forces Iowans through the use of their taxes into participating in a boycott or in this case, boycotting boycotters. Participation in boycotts should remain voluntary. This law sets a dangerous standard,” according to Nims.

Branstad said he did not know what the financial impact might be on state-funded investment portfolios but he did not think it would be a significant amount.

'I don't think it's huge but it sends a strong signal,” he said.

Mike Ralston of the Iowa Association of Business & Industry, who attended the signing ceremony, said the new law would promote open markets. He was uncertain of the financial scope of the issue in Iowa, but he added 'the numbers are greater than people realize.”

'Our organization is all about open markets, open borders so this is just a really good thing,” said Ralston. 'This effort that seems to be going on nationally to stop investment in Israel is short sighted.”